Does the Essential Facilities Doctrine stand after the Android Auto ruling?

On 25 February 2025, the Court of Justice of the European Union (ECJ) delivered its much anticipated judgment in the Android Auto case (C-233/23). The case concerned whether a dominant platform's refusal to ensure interoperability between its platform and a third party app can constitute an abuse of dominance.

What you need to know

• Dominant companies running an open digital platform cannot rely on the "Essential Facilities Doctrine" and indispensability criteria to refuse access to downstream app developers.
• Competition authorities must show that the refusal is capable of having anti-competitive effects, taking into account all relevant factual circumstances. The fact that an app developer (or business user) continues to grow is a relevant circumstance but it does not preclude a finding of anti-competitive effects.
• Dominant companies need to evidence security concerns or technical impossibility to justify their refusal.
• A reasonable period of time to implement the requested interoperability may be objectively necessary in light of technical difficulties or a lack of resources. The dominant company may also request a fair and non-discriminatory financial contribution.
• The Essential Facilities Doctrine and indispensability criteria remain relevant in relation to infrastructure or assets that firms have developed for their own needs (i.e., they did not develop the infrastructure or asset with the intention of offering third parties access to it).

Background

In 2015, Google launched its Android Auto platform which enables Android OS users to access their mobile apps on their car's dashboard. Google created templates allowing for interoperability of some third-party apps with its Android Auto platform. In 2018, Enel X Italia (Enel) asked Google to take steps to ensure that its EV charging management app (JuicePass) was compatible with Android Auto. Google refused because, at the time, templates were only available for multimedia and messaging apps and not for the type of apps offered by Enel. It also referred to security concerns and the need to allocate resources for the creation of a new template.

Enel complained to the Italian competition authority, which imposed a EUR 102 million fine on Google for abuse of dominance. Google challenged that decision before the Italian administrative courts. In 2021, on appeal, the Italian Council of State referred several questions to the ECJ for a preliminary ruling.

The ECJ's ruling

ECJ clarifies the scope of the Essential Facilities Doctrine

The ECJ first clarified whether a refusal by a dominant undertaking to ensure interoperability between its platform and a third party app can be abusive if that platform is not indispensable for the app's operation but makes the app more attractive for consumers.

Following the so called "Essential Facilities Doctrine" developed in Magill, Bronner, IMS Health and subsequent case-law, an outright refusal to grant access to infrastructure developed by a dominant undertaking for its own needs can be abusive only if the infrastructure is indispensable for carrying out activities in an adjacent market. Third parties therefore need to show that no actual or potential alternative exists. This protects the dominant undertaking's freedom of contract and right to property, as well as its investment incentives.

In Android Auto, the ECJ clarifies that the strict Bronner indispensability condition applies only where the infrastructure (i) was developed by the dominant undertaking solely for the needs of its own business; and (ii) is owned by that undertaking. By contrast, it does not apply where a dominant company has developed infrastructure (in this case, a digital platform) with a view to enabling third party use. The rationale is that the company already assumed the cost of developing the platform for the benefit of third parties and an obligation to ensure interoperability does not therefore fundamentally alter its economic model.

In this case, Google could not rely on the indispensability condition as it granted access to Android Auto to other third party app developers (which is evidence that Auto Android was designed for third party use).

Legal standard for finding an abusive refusal to ensure interoperability

On the applicable legal standard, the ECJ confirms that a competition authority must complete an effects analysis in order to find that a refusal to ensure interoperability is abusive. The authority does not need to show that the refusal to ensure interoperability led to actual exclusionary effects on the downstream market. However, it must show that the conduct was capable of foreclosing as efficient competitors at the time it was implemented. This analysis should take into account all relevant factual circumstances.

Demonstrating that the downstream market has remained as (or even more) competitive is not indisputable evidence that the access refusal was incapable of anti-competitive effects. This is because anti-competitive effects could be mitigated by the downstream competitors' ability to react and, absent the refusal to supply, the downstream market could have become even more competitive.

Nonetheless, the ECJ recognised that the fact that Enel and its competitors had maintained, and even improved, their positions on the downstream market is relevant to the overall assessment. Evidence of the attractiveness of Enel's app to users, despite the lack of interoperability, may also be relevant in that context.

Finally, the ECJ clarified that a competition authority is not required to precisely define the relevant market on which the conduct is allegedly capable of producing anti-competitive effects. However, it must establish that the dominant company and the company seeking access are at least potential competitors on a potential downstream market where the refusal produces effects.

Objective justifications for refusing to ensure interoperability

The ECJ confirmed that, where a refusal to ensure interoperability is capable of being abusive, a dominant firm can demonstrate that its conduct is objectively necessary. However, the ECJ held that this defence is only available in situations where granting interoperability would (i) compromise the integrity or security of the platform or (ii) be technically impossible. In all other circumstances, the absence of a template for specific categories of apps or the difficulties encountered in developing a new template would not constitute an objective justification.

Implementation of the requested interoperability

The ECJ acknowledges that it may be objectively necessary to allow the dominant firm a reasonable period of time to implement the requested interoperability in light of specific circumstances (including, in particular, technical difficulties, unavailability of resources and regulatory constraints). In addition, the dominant company may ask for a financial contribution from the company requesting interoperability, provided this contribution is fair, proportionate and in line with the actual costs incurred.

Comment

Reflection on the test developed by the ECJ

The ECJ ruling clarifies that dominant companies running infrastructure designed for third party use cannot rely on the Essential Facilities Doctrine and indispensability criteria to refuse access to some downstream players. Given Google was running its own navigation apps on Android Auto and had taken the necessary steps to ensure interoperability with other third-party apps, the facts at issue could be seen more akin to a case of self-preferencing and discrimination than a refusal to grant access.

The judgment seems slightly unsatisfactory when it comes to the identification of the circumstances in which a refusal to deal / interoperate will be considered abusive. The ECJ held that it must be shown that the company which has developed the (dominant) infrastructure is (at least) a potential competitor of the access seeker. However, the ECJ did not analyse the evidence that Google was developing products which compete with Enel's product and instead simply referred to the Italian competition authority's view (which was that Google Maps competes with Enel's application which makes use of Google Maps).

If it is a question of discrimination in the provision of access, it must in principle be shown that the discriminatory treatment produces or can produce a concrete competitive disadvantage for the access seeker on the downstream market (see the ECJ's judgment in MEO for the relevant test under Article 102(c) of the Treaty on the Functioning of the EU). This may arise where either: (i) the owner of the platform has effectively developed a product competing with the products of the access seeker; or (ii) the owner of the platform has granted access to companies competing with the access seeker (which was not the case here). The test in Android Auto, which focuses on potential competition on a potential downstream market, seems difficult to reconcile with the ECJ's case-law on discrimination and self-preferencing. It is difficult to understand why the owner of a platform should invest in ensuring interoperability in circumstances where: (i) the platform is not essential for the access seeker's success on the downstream market or (ii) the access seeker does not face actual or imminent competition of other market players who can access the platform.

Implications for operators of open digital platforms

The ruling is significant for dominant companies operating open digital platforms (including operating systems, online marketplaces or AI models), which are by definition designed for third party use. The ruling highlights the risks for digital gatekeepers in responding to requests from downstream players to provide interoperability. When requested, they should take steps within a reasonable timeframe to ensure interoperability with third party apps or other business users unless they have solid technical or security reasons.

The judgment echoes the obligations under the Digital Markets Act (DMA) for digital gatekeepers to ensure interoperability and fair, reasonable and non-discriminatory access to downstream players. Arguably, the ECJ gives flesh to the application of these obligations under the abuse of dominance prohibition (set out in Article 102 of the Treaty on the Functioning of the European Union) beyond the material and temporal scope of the DMA.

The referring Italian court will now consider the merits of the case, in light of the ECJ's guidance. It will be particularly interesting to see how the referring court applies the effects analysis and how much weight it gives to the success of Enel's JuiceApp, despite its lack of interoperability with Android Auto.

Does the Essential Facilities Doctrine stand after the Android Auto judgment?

While the judgment has important implications for dominant firms in the digital economy, the ECJ has not overturned the Bronner line of case law. The Essential Facilities Doctrine and indispensability criteria still apply where a dominant firm has developed an input exclusively for its business needs. This is relevant for many situations across a range of industries, including in relation to intellectual property rights, vertically integrated services, data sets, and closed digital ecosystems developed by dominant companies. Where dominant firms choose to grant access to some players (e.g. through a licence to use an intellectual property right), they should however be wary that the Bronner protection may not apply and there would therefore be a lower standard of proof to establish an abuse of dominance.

An important question will be when a platform is deemed to be open, or destined to be open, to third parties: for example, is a platform considered to be open if the platform owner provides access to certain functionality to its own clients? In Bronner, Mediaprint had granted a third party (De Standard) access to its platform but De Standard was Mediaprint's client for many services. This is unlikely to be the last case where the boundaries of Bronner are considered by the ECJ.

Other author: Maria Oikonomou, Legal Intern